Insurance - Study Mode

[#431] Which of the following options is correct?
Correct Answer

(B) Premium paid towards health cover earns income tax rebate under section 80D of the Income Tax Act

Explanation

Solution: Section 80D of the Income Tax Act deals with rebates. Tax Benefits of Health Insurance Under Section 80D. Health insurance premium paid for self, spouse, dependent children or parents qualifies for tax deduction up to Rs.25,000. This limit has been increased from Rs.15,000 from the previous year to Rs.25,000.

[#432] State the incorrect statement of the following ones.
Correct Answer

(A) Premium for an MRP as a collateral for a bank loan need not be paid as the bank is expected to pay the same
(G) There is no material difference between a term insurance policy and an MRI as far as benefits are concerned

Explanation

Solution: Keyman insurance helps a business recover from the loss of its valuable assets viz. the persons who run it and/or own it. Individual talents are becoming critical to the success of many companies and employees are also becoming an important factor in investors' valuation of the entities. Every business has at least a few very valuable employees who contribute significantly to the running and growth of the company.

[#433] The _________ the premium paid by you towards your life insurance, the _________ will be the compensation paid to the beneficiary in the event of your death.
Correct Answer

(A) Higher, higher

Explanation

Solution: The higher the premium paid by you towards your life insurance, the higher will be the compensation paid to the beneficiary in the event of your death.

[#434] Which of the following are the disadvantage(s) of Traditional With Profit policies over ULIPs?
Correct Answer

(D) All of the above

Explanation

Solution: Bonuses are declared only once a year and do not reflect daily fluctuations in the value of the assets, Policyholder's benefits depend on assumptions/discretions of the insurance company and Bonus structure does not reflect the true value of assets of the insurer are the disadvantages of Traditional With Profit policies over ULIPs.

[#435] Annuity belongs to
Correct Answer

(C) Both A & B

Explanation

Solution: Annuity belongs to one where the annuity amount is fixed (guaranteed) and one where the annuity amount is variable (linked to investment performance).